The Wayback Machine - https://web.archive.org/web/20130726203228/http://www.guardian.co.uk/world/2007/feb/09/russia.usa

Big rise in Russian military spending raises fears of new challenge to west

· Moscow anxious over US missile defence plans
· Hawkish minister outlines $189bn hardware revamp

Concerns were growing yesterday over a new bout of east-west confrontation, after Russia unveiled a big increase in military spending in the wake of the American decision to site parts of its controversial missile defence system in eastern Europe.

Russia's hawkish defence minister, Sergei Ivanov, revealed an ambitious plan for a new generation of intercontinental ballistic missiles, nuclear submarines and possibly a fleet of aircraft carriers. Moscow also intended to revamp its early warning radar system. This major overhaul of Russia's military infrastructure would cost $189bn (£97bn) over eight years, he said, adding that he wanted to exceed the Soviet army in "combat readiness".

The sharp rise in expenditure comes at a time of growing coolness in US-Russian relations. Vladimir Putin has been incensed by the Bush administration's intention to site missile defence systems in Poland and the Czech Republic.

The US says the installations are being built to shoot down possible long-range missiles fired by Iran or North Korea. But Mr Putin has dismissed this claim as ludicrous, and has said the real target of the missile shield is clearly Russia and its vast nuclear arsenal. In a speech tomorrow in Munich, the president is expected to deliver Russia's scathing response.

Defence and security leaders are to meet in the German city over the weekend to wrestle with issues such as Kosovo, Afghanistan and Iran. President Putin and Mr Ivanov will deliver speeches, as will the new Pentagon chief, Robert Gates, the German chancellor, Angela Merkel, and Ali Larijani, the key Iranian official for Tehran's suspect nuclear programme.

Yesterday analysts said Moscow was worried the defence shield in eastern Europe could turn into a Trojan horse.

"This is irritating for Russia," said Yevgeny Miasnikov, a senior research scientist at Moscow's Centre for Arms Control. "When the Soviet Union collapsed a vacuum was created in the countries of the former Warsaw bloc. The US has tentatively moved into the vacuum and is creating infrastructure that might threaten Russia. The Bush administration's system is not justified. Iran doesn't have a missile capability yet to hit the US. The logical place to put a defence system would be in Turkey, or in Russia itself."

In his speech to Russia's parliament, Mr Ivanov announced that the military would get 17 ballistic missiles this year, compared with an average of four in recent years. The plan envisages the deployment of 34 new silo-based Topol-M missiles and control units, as well as another 50 such missiles mounted on mobile launchers by 2015, he said. Russia has already deployed more than 40 silo-based Topol-Ms.

Writing in a Munich newspaper yesterday, Mr Ivanov said: "The deployment of American missile defence in Europe has not only a military but also a symbolic significance. Fifteen years after the end of the cold war a situation is obviously being created in which the continent again can only manage with American protection and with reinforced American military presence."

In 2002, Mr Putin and George Bush signed a treaty obliging both sides to cut strategic nuclear weapons by about two-thirds by 2012. But Russian-US ties have since worsened steadily over disagreements on Iraq and other global crises, and US concerns about an authoritarian streak in Russia's domestic policy.

The modernisation of the armed forces has been made possible by Russia's spectacular economic resurgence based on oil and gas revenues. After the Soviet Union's demise, Russia's vast military economy collapsed. The squeeze continued in the 1990s, but since 2000 spending has gone up, with this year's budget of $31bn almost four times the amount spent in 2001.

Russian defence analysts point out, however, that defence spending is still well below that of the mid-1980s Soviet Union, and only a 20th of the US's current military budget.

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